Wage & Hour Issues

Maintaining Independent Contractor Status Now that the U.S. Department of Labor’s New Rule Has Taken Effect

June 10, 2024 | Parks, Chesin & Walbert

Commentators sometimes cast independent contractor status as a tool for employers to exploit employees and avoid paying those workers properly. In reality, independent contractor status can provide substantial advantages to workers… and some prefer it. With the U.S. Department of Labor’s new final rule regarding employee-versus-independent-contractor status having taken effect on March 11, independent contractors and hiring entities may wonder what they can do to ensure compliance with the new rule. A good place to start is peaking to a knowledgeable Atlanta wage and hour lawyer.

As noted above, some workers firmly prefer independent status. Independent contractor status allows workers to set their own schedule/hours, control how they do their work, and, in many situations, not have the income limitations that salaried work does.

One industry with many independent contractors is real estate. According to the National Association of Realtors, around 89% of its members work as independent contractors.

‘Discretion and Independent Judgment’ Within the Context of the Administrative Exemption to the FLSA’s Overtime Rules

May 31, 2024 | Parks, Chesin & Walbert

One way for an employer to defeat an employee’s unpaid overtime claim is to establish that the worker was exempt from those provisions in the Fair Labor Standards Act. The law has several types of FLSA exemptions, including the executive exemption, the administrative exemption, the professional exemption, the computer employee exemption, the outside sales exemption, and the highly compensated employee exemption, among others. Whether you are an employee or an employer, understanding the scope of these exemptions, and when they do (or don’t) apply can be crucial. An experienced Atlanta wage-and-hour lawyer can provide much-needed advice and information about these exemptions.

A recent case from the Middle District of Georgia looked at one exemption in particular – the administrative exemption.

According to the employees’ lawsuit, their employer illegally failed to pay them overtime compensation in violation of the FLSA. The employer contended that it did not owe the women overtime pay because the administrative exemption applied.

Overtime and Minimum Wage Violations Cost Employers More Than $150M in 2023

April 30, 2024 | Parks, Chesin & Walbert

Back in January, the U.S. Department of Labor published its annual report detailing the accomplishments of its Wage and Hour Division. The “WHD by the Numbers 2023” report revealed several key things. One was the cost of employers’ failure to comply with the Fair Labor Standards Act. In 2023 alone, employers paid out more than $151 million to the WHD due to overtime and minimum wage violations. This should tell readers that FLSA non-compliance can be a substantial – and often unnecessary – drain on a business’s revenues. To ensure your business is fully compliant with all the FLSA’s demands, be sure you’ve consulted an experienced Atlanta wage and hour lawyer.

Overtime and minimum wage compensation are areas where misclassification often plays a major role. Overtime non-compliance can arise from misclassifying an employee as an independent contractor or misclassifying a non-exempt employee as an exempt employee. Misclassification-related minimum wage violations often are the result of erroneously classifying an employee as an independent contractor.

The report highlighted some other noteworthy information, including:

A New Federal Overtime Regulation Stands to Alter the FLSA Exemption Status of Millions of Employees, According to the U.S. Labor Department

April 24, 2024 | Parks, Chesin & Walbert

Yesterday, the U.S. Department of Labor announced the publication of a new regulation governing the salary minimums applicable to certain exemptions under the Fair Labor Standards Act; namely, the executive, administrative, professional, outside sales, [or] computer employee” (a/k/a “EAP”) exemption and the highly compensated employee (HCE) exemption. According to DOL estimates, the new rule is a major departure from the previous rule, potentially moving as many as four million employees from exempt to non-exempt status. This change may significantly benefit those workers who become non-exempt. It also represents a critical decision-making juncture for employers. To ensure your business remains compliant with the FLSA in the face of the changing exempt-versus-non-exempt landscape, consult a knowledgeable Atlanta wage and hour lawyer.

The new rule is the result of a months-long rulemaking process. Last September, the DOL published a proposed version of the regulation. The proposed rule called for increasing the minimum salary level for qualifying as an exempt EAP employee to $1,059 per week (or $55,068 annually.) The department chose that figure because it represented “the 35th percentile of weekly earnings of full-time salaried workers in the lowest-wage Census Region.” (By the way, that lowest region is here in the South.)

The proposed rule also called for raising the minimum salary for qualifying under the HCE exemption to $143,988 annually. That figure was equal to the “annualized weekly earnings of the 85th percentile of full-time salaried workers nationally.”

A Lawsuit by 3 Golf Course Attendants Spotlights the Criteria of the FLSA’s ‘Public Agency Volunteer’ Exemption

March 18, 2024 | Parks, Chesin & Walbert

Whether you are an employer or a worker, employee-versus-nonemployee classification for purposes of employment law is a vital step, and the extreme importance of this classification process is something where you definitely should consult a knowledgeable Atlanta wage and hour lawyer. As a worker, misclassification may improperly deny you access to many statutory rights, including those guaranteed by the Fair Labor Status Act. As an employer, misclassification can inflict its own potential harm, including legal liability and an obligation to pay substantial court-ordered compensation to the worker(s) who sued your business.

Often, misclassification disputes involve deciding whether a worker is an employee or an independent (1099) contractor. As an FLSA case that recently came before the 11th Circuit Court of Appeals illustrates, that’s not the only way that misclassification can occur, and any classification that improperly fails to designate a worker as an employee can have serious negative consequences.

The plaintiffs performed services at a public golf club in South Florida. These roles included course rangers, cart attendants, driving range attendants, and bag drop attendants. The county specifically listed the positions as “volunteer” roles. They received no wages but were allowed to accept tips. As a perk, volunteers performing these tasks were entitled to “reduced fees to play and practice golf.” Specifically, volunteers who worked at least one seven-hour shift each week were entitled to “unlimited” rounds of golf at a steep discount ($5 per round instead of the standard $96 per round.)

Engaged to Wait or Waiting to Be Engaged: When On-Call Hours Are (and Aren’t) Compensable

February 29, 2024 | Parks, Chesin & Walbert

A recent minimum wage case from Massachusetts is a reminder that just because an employee is not actively engaged in conducting the employer’s business — or maybe even is asleep — that doesn’t mean those hours aren’t compensable time. Hours spent on-call or waiting to work may or may not be compensable time under the Fair Labor Standards Act. The analysis depends on the totality of the circumstances and, as the courts have put it, were the employees “engaged to wait” or waiting to be engaged? Whether or not you’re an employer or an employee, understanding what time is compensable (and what isn’t) is crucial. An experienced Atlanta wage and hour lawyer can help you make those assessments and take the appropriate next steps.

The case from the Massachusetts federal court involved long-haul truck drivers. Federal regulations demand that truck drivers spend 10 hours of every 24 off duty, but other regulations say that employers when determining compensation, can deduct a maximum of eight hours of every 24 as a sleeping period. The drivers’ minimum wage lawsuit contended that they should be entitled to compensation for 16 hours, not 14.

The court sided with the employees. Given that the drivers spent the hours in dispute in a moving semi-truck (a confined space “that is ill-equipped for many activities,” “containing only some basic living essentials,” and that drivers cannot leave until the truck stops moving,) the court concluded that the time was not truly the drivers’ own but instead spent predominantly for the benefit of the employer, making it compensable.

A Nanny’s Overtime Case Sheds Light on the Extent of the Domestic Service Exemption’s Application

February 15, 2024 | Parks, Chesin & Walbert

Domestic workers (like nannies and housekeepers) are a diverse group. Even fictional depictions range from Julie Andrews’ Mary Poppins to Robin Williams’ Mrs. Doubtfire. In real life, these workers often put in long hours, working more than 40 hours a week. Those facts may mean that a nanny or housekeeper may be entitled to substantial overtime compensation if they qualify as a non-exempt employee. If you have questions about the Fair Labor Standards Act’s overtime requirement or the domestic service exemption, consult an experienced Atlanta wage and hour lawyer.

A South Florida nanny’s recent unpaid overtime case clarified the breadth/narrowness of the domestic service exemption in federal cases in Georgia and two surrounding states.

The worker began as a full-time nanny and housekeeper for two South Florida parents in 2019. The nanny worked overnight shifts for five consecutive nights, totaling 79 hours per week. The parents paid the nanny a flat rate of between $800 and $880 weekly.

A Georgia Delivery Driver Wins Payment of Post-Judgment Collection Costs and Fees Following a Successful FLSA Claim

January 31, 2024 | Parks, Chesin & Walbert

Food delivery drivers frequently can be the victims of Fair Labor Standards Act violations. That can include improperly underpaying drivers who use their personal vehicles for deliveries (by paying them only the minimum wage and then not properly paying them for the vehicle expenses they incur,) or illegally underpaying them as a result of misclassification as exempt employees when they really were non-exempt. Whether you’re a driver who believes your employer denied you the pay that you were owed under the law, or you’re an employer seeking to ensure that your pay practices are compliant with relevant laws, if you have questions about the FLSA, you should seek out knowledgeable answers from an experienced Atlanta age and hour lawyer.

One of those underpaid workers was A.N., a North Georgia pizza delivery driver, who filed to arbitrate a claim that the employer had illegally underpaid him in violation of the FLSA in 2019. The next year, an arbitrator sided with the driver and concluded that he had suffered $5,198 in actual damages. Coupled with $5,198 in liquidated damages and $153,867 in attorneys’ fees and costs, the total award was $164,264. The federal court for the Northern District of Georgia affirmed the award.

The employer, however, refused to pay. That forced the driver to bring a collection suit in federal court in Missouri, which the employer contested. The driver ultimately succeeded in collecting the judgment but spent an additional $53,934 to do so. The driver, in pursuit of the collection of those expenses, returned to the Northern District court on a motion for fees and costs.

An Unpaid Overtime Case from Atlanta Sheds Light on the Importance of Keeping Good Pay Records

October 24, 2023 | Parks, Chesin & Walbert

An Atlanta wrecker and towing service found itself in court after two drivers accused it of illegally failing to pay them the overtime compensation they were properly due under the Fair Labor Standards Act. The court’s summary judgment ruling in the case includes vital lessons for employers when it comes to the importance of maintaining clear and thorough pay records, as well as the risks involved in handing off FLSA compliance to a third party. If you’re facing an unpaid overtime claim (or pursuing one,) representation from a knowledgeable Atlanta wage and hour lawyer can be essential to your success.

The drivers typically worked 4-5 12-hour shifts each week. The employer paid its driver a straight commission weekly that was “calculated as a percentage of the total revenue they derived from the tows they performed that week.” For one driver that percentage was 30%, for the other it was 35%.

As noted above keeping clear, understandable, and accurate time and pay records for all employees can be crucial to any business.

The U.S. Department of Labor Proposes a Major Modification in the Salary Threshold Tied to the FLSA’s Executive and Administrative Exemptions

September 30, 2023 | Parks, Chesin & Walbert

Earlier this year, the Fair Labor Standards Act celebrated its 85th anniversary. Later this year, the executive and administrative exemptions will also turn 85 years old. The FLSA helps ensure workers receive fair compensation, while the exemptions provide important aid to employers. Whether you are an employer or an employee, it’s important to understand what the FLSA and its exemptions do (and don’t) require. If you have questions, get in touch with a skilled Atlanta wage-and-hour lawyer to get the knowledgeable answers you need.

When the federal government created the first salary threshold for the executive and administrative exemptions in 1938, that number was $1,560 annually. By 1949, the figure was $5,200.

Currently, the minimum salary an employer can pay and also claim the executive or administrative exemption is $684 per week, or just over $35,500. If a proposed rule from the U.S. Department of Labor takes effect as written, that figure will — for the first time — climb above $50,000 annually, at $1,059 per week, or just slightly above $55,000 annually.